02 Dec South African Airways facing ‘radical restructuring’ in fight for survival
South Africa’s Minister of Public Enterprises Pravin Gordhan has told struggling South African Airways (SAA) that it needs a ‘radical restructuring’ to ensure financial and operational sustainability going forward.
The minister said his department was locked in discussions with the state-run airline’s board and executive committee over the past week to secure a loan guarantee of at least R2 billion in order for SAA to continue trading.
The ministry also said it is pursuing various options to turn around SAA, without providing further detail.
SAA hasn’t made a profit since 2011 and has become dependent on government bailouts to remain solvent. In the last month, the firm was pushed to the brink of collapse by a crippling eight-day strike.
In the wake of the strike, two large national travel insurers – Sanlam and Flight Centre Travel Group – stopped covering SAA tickets against insolvency, piling further pressure on the embattled airline.